Gov. Hassan wants to partner with federal government on health insurance exchanges

By GARRY RAYNOState House BureauFebruary 12. 2013 8:03PMCONCORD - Gov. Maggie Hassan will seek a partnership with the federal government in running a health insurance exchange for New Hampshire, and has the blessing of a key legislative oversight committee.

The state has until Friday to ask the federal Health and Human Services Agency to partner with the state government in running the exchange which is part of the Affordable Care Act.

The governor's legal counsel, Lucy Hodder, told the Joint Health Care Reform Oversight Committee on Tuesday the partnership is the only way for the state to preserve its authority over carriers, plans and those assisting the state's residents who go to the exchange for health insurance.

"Right now if we don't tell the federal government what we want control over, we will lose it," Hodder said. "We have lost a lot (of control) already."

Two of the three Republicans on the six-member committee voted not to approve the letter the governor intends to send to federal regulators by Friday.

"It was obvious to me that far too many questions remain unanswered, and I am uncomfortable putting New Hampshire on the path toward this partnership until more information is available to allow us to fully weigh the costs versus the benefits for patients, providers, and taxpayers," said committee member and Senate Majority Leader Jeb Bradley, R-Wolfeboro.

He was also concerned the federal government would run roughshod over state regulations under the partnership. "Knowing a little something about the federal government," said Bradley who served two terms in the U.S. House, "we'll get the scraps of regulatory authority and rule of regulation and the feds will get preemption, preemption, preemption. That is my fear."

Under the draft letter approved by the committee, Hassan indicates the state wants to partner with the federal government both in plan management and consumer assistance, which would have federally hired "navigators" help consumers find the best health insurance plan for them in the exchange.

"A Partnership Exchange is essential to preserving New Hampshire's traditional regulatory authority over insurance carriers and producers, as well as its Medicaid program," Hassan writes in the letter.

The governor notes in the draft letter of intent that the exchange will not "impose a cost on the state's general fund or create new state programs," and that federal grants would cover any state cost through 2014.

Hassan also notes the state understands it can terminate the partnership at any time.

The lone Republican on the oversight committee to vote to approve the draft letter, Rep. John Hunt of Rindge, likened the partnership to a poker player saying you have to ante up to get in the game.

"Hopefully this is something that will protect the state," he said before the vote.

Senate Republicans have argued for weeks Hassan needed the committee's approval to move forward with a partnership, but other legal opinions maintain she can act on her own, citing the law passed last year urging the state to retain as much regulatory authority as possible, particularly over insurance plans and carriers, and Medicaid eligibility.

State law forbids New Hampshire from running its own exchange.

Tuesday, Bradley continued to maintain the governor needs the consent of the oversight committee to proceed with a partnership. "In the weeks ahead, I will be working to ensure the proper procedures are established to ensure this issue can be considered by the full legislature," Bradley said.

As the memorandum of understanding between the state and the federal Health and Human Services becomes more defined, Hodder said the governor will bring various aspects to the committee.

Democratic leaders in the House and Senate praised the committee's vote and the governor's intent to ask for a partnership with the federal government.

"Leaving control of New Hampshire's exchange solely in the hands of the federal government is not in the best interest of our citizens and businesses and should not be considered as a viable option as we move forward," said Senate Minority Leader Sylvia Larsen, D-Concord.

House Speaker Terie Norelli said the insurance and health and human services departments believe a partnership is the best way for the state to retain traditional regulatory control.

"Without pursuing a partnership for our exchange, New Hampshire is ceding regulatory control over New Hampshire businesses to the federal government," Norelli said. "Moving forward with a partnership exchange is good for the health of New Hampshire's people and just plain common sense."

The exchange would be set up and operated by the federal government under a partnership, but the insurance department would continue to regulate the insurance carriers and plans offered on the exchange according to Insurance Department legal counsel for health Jennifer Patterson.

The state would also regulate the consumer helpers or navigators who will guide state residents through the process but are not supposed to recommend one policy over another.

The state does not intend to seek a partnership with the federal government for administering the reinsurance program under the exchange according to Hassan's draft letter.